Why does Turbotax indicate in block B4 of my 1099R form that the entire amount of my yearly civil service retirement annuity is eligible for conversion to a Roth?

[moorentax]

Turbotax did not do this on my 2015 return.

[SweetieJean]

There is no Block B4 on a 1099-R form.  Are you referring to some worksheet?

[moorentax]

It is part of the 1099-R worksheet form in Turbotax elated to my annual civil service retirement annuity.

[dmertz · Accepted solution]

This is referring to line B4 of TurboTax's 1099-R form.  This is the amount of the distribution that TurboTax believes to be *eligible* for rollover based on the information on the Form 1099-R and your answers to TurboTax's follow-up questions.  However, because distributions from a civil-service retirement annuity would typically be a series of substantially equal payments for life or for a period of 10 year or more, the law does not permit these distributions to be rolled over, despite TurboTax indicating otherwise.

Presumably you did not roll over any of these distributions, so you can ignore the amount shown on line B4 of TurboTax's 1099-R form.

As to why this is different from the same form from your 2015 tax file, it's possible that you had indicated in 2015 TurboTax that this distribution was all RMD, preventing TurboTax from being able to consider any of it being eligible for rollover.

[moorentax]

Your answer makes sense in that I did not think that these distributions should  be eligible for rollover which is why I asked the question. Are you saying that Turbotax has an error that causes bock B4 to be wrong. I don't think that I incorrectly indicated that the distribution was all RMD in 2015; and  am certain that I did not indicate it was all RMD in 2016. I just can't understand why Turbotax would show it all as eligible for rollover.  All of my inputs are as reflected in my CSA1099 form supplied by the government so I can't see how any of my inputs would cause the error. Is this a known Turbotax error or is it likely due to some input error by me?

[dmertz]

TurboTax does not consider the possibility that these distributions might not be eligible for rollover due to being a series of substantially equal periodic payments for life or for a period of 10 years or more.  Generally, TurboTax is software for preparing your tax return, not software to inform you of or to enforce the tax laws.  If you did (inappropriately) roll over one of these distributions, as long as you do not indicate that the distribution was all RMD, TurboTax will permit you to report it as a rollover even though it was not permissible to roll over the distribution.  TurboTax does ask some questions to determine which questions are appropriate to ask next, such as asking someone over age 70½ if the entire distribution was RMD so as to avoid unnecessarily asking about rollovers, but TurboTax doesn't ask all possible questions to cover all possible scenarios.  In this case TurboTax relies on you to have complied with the tax laws and to indicate that you did not roll over any of the distributions.

[moorentax]

Thanks for your help. I have not rolled over any of these distributions because I did not think that was possible or legal. I was just surprised when Turbotax indicated that the distributions were eligible for conversion to Roth. I assumed Turbotax knew these were civil service retirement payments based on the inputs from the government provided CSA 1099 form that I used in completing the Turbotax 1099-R form.  I just didn't understand why Turbotax would then say in Block 4B that these payments were eligible for rollover. Thanks again for your help